Sunoco upgraded at Citi on "best deal team in the game"

Sunoco LP (SUN+1.8%) is higher after Citigroup upgrades shares to Neutral from Sell with a $29 price target, raised from $22, saying SUN's management team has proven to be "the best deal team in the game" in its space.

Citi analyst Faisel Khan lauds the deal SUN struck with the 7-11 convenience store chain in which it agreed to sell 1,110 of its retail stores; prior to the deal, SUN was not only "significantly" overlevered but unable to cover its distributions and "headed for capitulation," Khan writes.

But Khan says that while the asset sale is a "game changing" move, it does not fully erase the case against owning the stock, as SUN did not provide answers to key questions around the deal, including tax implications and plans to address an apparent hole in coverage.